PRIMUS Telecommunications to Acquire the Internet Service and Interactive Media Businesses from the Shareholders of AOL/7 and to License the AOL Brand in Australia

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Wednesday, February 11, 2004; 12:00 AM

MCLEAN, Va.--(BUSINESS WIRE)--Feb. 11, 2004--PRIMUS Telecommunications Group, Incorporated (Nasdaq:PRTL), a global telecommunications services provider offering an integrated portfolio of voice, Internet, voice over Internet protocol (VOIP), data and hosting services, announced today that Primus Telecommunications Pty Ltd (Primus Telecom), its wholly-owned subsidiary in Australia, has agreed to acquire the internet service and interactive media businesses of AOL/7 Pty Ltd (AOL/7). AOL/7 is a joint venture between America Online Inc. (AOL), a wholly-owned subsidiary of Time Warner Inc., AAPT Limited, a unit of the Telecom New Zealand Group, and Seven Network Limited. The transaction is subject to a regulatory process in Australia and is expected to be consummated by the end of this month. Primus Telecom will acquire 100% of the issued stock of AOL/7 providing Primus with the customer base, content, content development and online advertising businesses, as well as a license for the AOL brand in Australia, for a total consideration of approximately $18 million (US), payable in cash.

The acquisition will add approximately 90,000 customers to Primus Telecom's existing Internet customer base, sold under the iPrimus brand, of approximately 400,000 and will provide the aggregate customers with an enhanced range of innovative services, products and interactive content. Greg Wilson, Managing Director of Primus Telecom, said: "We believe that the AOL/7 acquisition will be an excellent fit with the operations of our own Internet and telephony business. Customers of iPrimus will have access to leading content, online expertise and world class technologies. AOL/7 customers will be able to subscribe to iPrimus's accelerated dial-up service as well as broadband DSL offerings. This will provide an opportunity to introduce customers to new products and services, particularly in the area of broadband services bundled with our telephony products at extremely competitive prices."

K. Paul Singh, Chairman and Chief Executive Officer of PRIMUS, stated: "The AOL/7 transaction meets the essential criteria we have established for acquisitions -- they have to add scale in our existing major markets, they should be focused on adding customers, and they need to be accretive to our operating profitability and cash flow. This transaction meets all of those measures, further solidifies the award-winning iPrimus brand in Australia and will accelerate our bundling initiatives."

"Primus Telecom is a logical buyer of our Australian business and, in terms of its ability to meet the needs of our existing customers and employees, the preferred purchaser," stated Gerald Sokol, Jr., Executive Vice President of AOL International. "We are pleased to have come to this agreement with PRIMUS and look forward to pursuing other opportunities for collaboration with them in other global markets in which we both operate businesses."

PRIMUS Telecommunications Group, Incorporated (Nasdaq:PRTL) is a global facilities-based telecommunications services provider offering international and domestic voice, Internet, VOIP, data and hosting services to business and residential retail customers and other carriers located primarily in the United States, Canada, Australia, the United Kingdom and western Europe. PRIMUS provides services over its global network of owned and leased transmission facilities, including approximately 250 points-of-presence (POPs) throughout the world, ownership interests in over 23 undersea fiber optic cable systems, 19 carrier-grade international gateway and domestic switches, and a variety of operating relationships that allow it to deliver traffic worldwide. PRIMUS also has deployed a global state-of-the-art broadband fiber optic ATM+IP network and data centers to offer customers Internet, data, hosting and e-commerce services. Founded in 1994, Primus is based in McLean, VA. News and information are available at PRIMUS's Web site at www.primustel.com.

Primus Telecom is Australia's fourth largest fixed-line telecommunications carrier with approximately 750,000 retail customers including over 400,000 Internet customers. The Company offers a comprehensive range of voice, data, Internet and web hosting products, servicing both residential and business sectors. The Primus network offers nationwide coverage through its own backbone network with facilities in 73 cities across Australia. The network enables the Company to provide nationwide long distance competition and local call Internet access to 97% of the population. Primus operates its own fibre network in the five major capital cities, delivering a range of business direct-connect services including ISDN, ATM and Broadband DSL. Global connectivity is provided through an extensive voice, IP and ATM network operated by the parent company, Virginia-based Primus Telecommunications Group, Incorporated (Nasdaq:PRTL). Primus Australia news and information are available at the Company's Web site at www.primustel.com.au

For PRIMUS Telecommunications Group, Incorporated and Primus Telecom:

Statements in this press release concerning the AOL/7 transaction, future revenue, services, operating results and growth constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements are based on current expectations, and are not strictly historical statements. Factors and risks that could cause actual results or circumstances to differ materially from those set forth or contemplated in forward-looking statements include, without limitation: changes in business conditions; fluctuations in the exchange rates of currencies, particularly any strengthening of the United States dollar relative to foreign currencies of the countries where we conduct our foreign operations; adverse interest rate developments; whether we complete one or more financings; fluctuations in prevailing trade credit terms or revenues due to the adverse impact of, among other things, further telecommunications carrier bankruptcies or adverse bankruptcy related developments affecting our large carrier customers; changes in the telecommunications or Internet industry; adverse tax rulings from applicable taxing authorities; digital subscriber line, Internet, cable and telecommunications competition; changes in financial, capital market and economic conditions; changes in service offerings or business strategies; difficulty in migrating or retaining customers, or integrating assets; difficulty in providing voice-over-Internet protocol and wireless services; changes in the regulatory schemes or requirements and regulatory enforcement in the markets in which we operate; restrictions on our ability to follow certain strategies or complete certain transactions as a result of our capital structure or debt covenants; risks associated with our limited DSL, Internet and Web hosting experience and expertise; entry into developing markets; the possible inability to hire and/or retain qualified sales, technical and other personnel, and to manage growth; risks associated with international operations; dependence on effective information systems; dependence on third parties to enable us to expand and manage our global network and operations; dependence on the implementation and performance of our global asynchronous transfer mode + Internet protocol communications network; adverse outcomes of outstanding litigation matters; and the outbreak or escalation of hostilities or terrorist acts and adverse geopolitical developments. As such, actual results or circumstances may vary materially from such forward-looking statements or expectations. Readers are also cautioned not to place undue reliance on these forward-looking statements which speak only as of the date these statements were made. We are not necessarily obligated to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You are advised, however, to consult the discussion of risks and uncertainties under "Management's Discussion and Analysis of Financial Condition and Results of Operations-Liquidity and Capital Resources-Short and Long-Term Liquidity Considerations and Risks"; and "-Special Note Regarding Forward-Looking Statements" contained in our quarterly report on Form 10-Q for the period ended September 30, 2003, as filed with the Securities and Exchange Commission.

CONTACT: PRIMUS Telecommunications Group John DePodesta, 703-902-2800 jdepodesta@primustel.com SOURCE: PRIMUS Telecommunications Group